Trane Technologies plc Files 2023 Annual Report on Form 10-K

TL;DR

<b>Trane Technologies plc has filed its 2023 annual report (10-K) detailing financial performance and business operations for the year ending December 31, 2023.</b>

AI Summary

Trane Technologies plc (TT) filed a Annual Report (10-K) with the SEC on February 8, 2024. Trane Technologies plc filed its 2023 Form 10-K on February 8, 2024. The filing covers the fiscal year ending December 31, 2023. The company was formerly known as Ingersoll-Rand plc, with a name change date of June 12, 2009. Key financial data points and disclosures are included in the report. The report details various financial statement line items and disclosures.

Why It Matters

For investors and stakeholders tracking Trane Technologies plc, this filing contains several important signals. This 10-K filing provides a comprehensive overview of Trane Technologies' financial health, operational performance, and strategic initiatives for the fiscal year 2023, crucial for investors to assess the company's current standing and future prospects. The detailed financial statements and risk factors within this report offer insights into the company's revenue streams, profitability, debt levels, and potential challenges, enabling stakeholders to make informed investment decisions.

Risk Assessment

Risk Level: medium — Trane Technologies plc shows moderate risk based on this filing. The company's 10-K filing is a standard annual report, which, while comprehensive, requires detailed analysis to identify specific risks and opportunities beyond the general disclosures.

Analyst Insight

Review the detailed financial statements and risk factor disclosures in the 10-K to identify specific areas of growth, potential headwinds, and management's strategies for the upcoming fiscal year.

Key Numbers

• 2023-12-31 — Fiscal Year End (Period covered by the 10-K filing)
• 2024-02-08 — Filing Date (Date the 10-K was filed with the SEC)
• 0001466258-24-000047 — Accession Number (Unique identifier for the filing)
• 001-34400 — SEC File Number (SEC's file number for Trane Technologies plc)

Key Players & Entities

• Trane Technologies plc (company) — Filer of the 10-K
• Ingersoll-Rand plc (company) — Former name of Trane Technologies plc
• David S. Regnery (person) — Mentioned in relation to financial data
• Christopher J. Kuehn (person) — Mentioned in relation to financial data

Forward-Looking Statements

• Trane Technologies will continue to manage its debt obligations, including the 5.25% Senior Notes due 2033, effectively. (Trane Technologies plc) — medium confidence, target: 2025-12-31

FAQ

Industry Context

Trane Technologies operates in the climate control and energy efficiency sector, providing heating, ventilation, air conditioning (HVAC), and refrigeration systems and services.

Regulatory Implications

The filing is made under the Securities Exchange Act of 1934, requiring public companies to disclose material information to investors.

What Investors Should Do

1. Analyze the revenue and net income trends for fiscal year 2023 compared to prior years.
2. Examine the company's debt-to-equity ratio and cash flow statements to assess financial stability.
3. Review the risk factors section for any new or evolving risks that could impact future performance.

Key Dates

• 2023-12-31: Fiscal Year End — Marks the end of the reporting period for the 10-K.
• 2024-02-08: Filing Date — The date Trane Technologies plc submitted its 10-K to the SEC.

Year-Over-Year Comparison

This is the initial 10-K filing for the period ending December 31, 2023, following the previous year's filing.

Key Financial Figures

• $1.00 — registered Ordinary Shares, Par Value $1.00 per Share TT New York Stock Exchange 5
• $13,832.0 million — . This segment had 2023 net revenues of $13,832.0 million. Our EMEA segment innovates for custom
• $2,401.2 million — . This segment had 2023 net revenues of $2,401.2 million. Our Asia Pacific segment innovates fo
• $1,444.4 million — . This segment had 2023 net revenues of $1,444.4 million. 4 Table of Contents Products and
• $252.3 million — s may be appropriate. In 2023, we spent $252.3 million on research and development, focused on

Filing Documents

• tt-20231231.htm (10-K) — 2893KB
• ex414thirteenthsupplementa.htm (EX-4.14) — 34KB
• ex426eleventhsupplementali.htm (EX-4.26) — 34KB
• ex439twelfthsupplementalin.htm (EX-4.39) — 34KB
• ex443secondsupplementalind.htm (EX-4.43) — 33KB
• exhibit444descriptionofreg.htm (EX-4.44) — 97KB
• ex101globaloptionagreement.htm (EX-10.1) — 248KB
• ex102globalrsuagreementfeb.htm (EX-10.2) — 220KB
• ex103globalpsuagreementfeb.htm (EX-10.3) — 181KB
• ex107thirdamendment2021cre.htm (EX-10.7) — 156KB
• ex1010secondamendment2022c.htm (EX-10.10) — 147KB
• ex21subsidiarylisting2023.htm (EX-21) — 199KB
• ex221-listofguarantorsands.htm (EX-22.1) — 11KB
• ex231consentofindependentr.htm (EX-23.1) — 2KB
• ex311-ttx12312023.htm (EX-31.1) — 10KB
• ex312-ttx12312023.htm (EX-31.2) — 10KB
• ex32-ttx12312023.htm (EX-32) — 5KB
• ex971plcclawbackpolicy.htm (EX-97.1) — 28KB
• ex972ttfinancingclawbackpo.htm (EX-97.2) — 27KB
• image_01.jpg (GRAPHIC) — 140KB
• image_0a.jpg (GRAPHIC) — 177KB
• image_0d.jpg (GRAPHIC) — 23KB
• image_1a.jpg (GRAPHIC) — 3KB
• image_2a.jpg (GRAPHIC) — 21KB
• tt-20231231_g1.jpg (GRAPHIC) — 134KB
• 0001466258-24-000047.txt (&nbsp;) — 20382KB
• tt-20231231.xsd (EX-101.SCH) — 126KB
• tt-20231231_cal.xml (EX-101.CAL) — 114KB
• tt-20231231_def.xml (EX-101.DEF) — 1081KB
• tt-20231231_lab.xml (EX-101.LAB) — 1596KB
• tt-20231231_pre.xml (EX-101.PRE) — 1348KB
• tt-20231231_htm.xml (XML) — 2926KB

Item 1. Business

Part I Item 1. Business 4

Risk Factors

Item 1A. Risk Factors 13

Unresolved Staff Comments

Item 1B. Unresolved Staff Comments 24

Cybersecurity

Item 1C. Cybersecurity 24

Properties

Item 2. Properties 26

Legal Proceedings

Item 3. Legal Proceedings 26

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 26 Part II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 27

[Reserved]

Item 6. [Reserved] 29

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 30

Quantitative and Qualitative Disclosure About Market Risk

Item 7A. Quantitative and Qualitative Disclosure About Market Risk 47

Financial Statements

Item 8. Financial Statements 48

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 48

Controls and Procedures

Item 9A. Controls and Procedures 48

Other Information

Item 9B. Other Information 49

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 49

Item 10. Directors, Executive Officers and Corporate Governance

Part III Item 10. Directors, Executive Officers and Corporate Governance 49

Executive Compensation

Item 11. Executive Compensation 49

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 49

Certain Relationships and Related Transactions, and Director Independence

Item 13. Certain Relationships and Related Transactions, and Director Independence 49

Principal Accountant Fees and Services

Item 14. Principal Accountant Fees and Services 49

Item 15. Exhibits and Financial Statement Schedules

Part IV Item 15. Exhibits and Financial Statement Schedules 50

Form 10-K Summary

Item 16. Form 10-K Summary 62

Signatures

Signatures 63 Table of Contents CAUTIONARY STATEMENT FOR FORWARD LOOKING STATEMENTS Certain statements in this report, other than purely historical information, are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "forecast," "outlook," "intend," "strategy," "plan," "potential," "predict," "target," "may," "might," "could," "should," "will," "would," "will be," "will continue," "will likely result," or the negative thereof or variations thereon or similar terminology generally intended to identify forward-looking statements. Forward-looking statements may relate to such matters as projections of revenue, margins, expenses, tax provisions, earnings, cash flows, benefit obligations, share or debt repurchases or other financial items; any statements of the plans, strategies and objectives of management for future operations, including those relating to any statements concerning expected development, performance or market share relating to our products and services; any statements regarding future economic conditions or our performance including our future performance statements related to the continued impact of the Coronavirus Disease 2019 (COVID-19) global pandemic; any statements regarding our sustainability commitments; any statements regarding pending investigations, claims or disputes; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. These statements are based on currently available information and our current assumptions, expectations and projections about future events. While we believe that our assumptions, expectations and projections are reasonable in view of the currently available information, you are cautioned no

BUSINESS

Item 1. BUSINESS Overview Trane Technologies plc, a public limited company, incorporated in Ireland in 2009, and its consolidated subsidiaries (collectively we, us, our, the Company) is a global climate innovator. We bring sustainable and efficient solutions to buildings, homes and transportation through our strategic brands, Trane and Thermo King , and our environmentally responsible portfolio of products, services and connected intelligent controls. We generate revenue and cash primarily through the design, manufacture, sales and service of solutions for Heating, Ventilation and Air Conditioning (HVAC), transport refrigeration, and custom refrigeration solutions. As an industry leader with an extensive global install base, our growth strategy includes expanding recurring revenue through services and rental options. Our unique business operating system, uplifting culture and highly engaged team around the world are also central to our earnings and cash flow growth. Through our sustainability-focused strategy and purpose to boldly challenge what's possible for a sustainable world , we meet critical needs and growing global demand for innovation that reduces greenhouse gas emissions while enabling healthier, efficient indoor environments and safe, reliable delivery of essential temperature-controlled cargo. We have announced certain defined sustainability commitments with a goal of achieving these commitments by 2030 (2030 Sustainability Commitments). Trane Technologies' bold 2030 Sustainability Commitments have been verified by the Science Based Targets initiative (SBTi) and include our Gigaton Challenge' to reduce customer greenhouse gas emissions by a billion metric tons, Leading by Example' through carbon-neutral operations across our own footprint, and Opportunity for All' by building a diverse workforce reflective of our communities. Reportable Segments We operate under three reportable segments. Our Americas segment innovates for customers in North Ameri

, Item 1A, "Risk Factors - Risks Related to Litigation,"

Part I, Item 1A, "Risk Factors - Risks Related to Litigation,"

, Item 3, "Legal Proceedings,"

Part I, Item 3, "Legal Proceedings," Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations - Significant Events," and Part II, Item 8, Consolidated Financial Statements, Note 1, "Description of Company," and Note 20, "Commitments and Contingencies." Human Capital Management Our people and culture are critical to achieving our operational, financial and strategic success. As of December 31, 2023, we employed approximately 40,000 people in approximately 60 countries including over 15,000 outside of the United States. As of December 31, 2023, 25.9% of our global employees were women and 37.2% of our employees in the United States were racially and ethnically diverse. In 2023, 30.9% of our new hires globally were women and 53.0% of new hires in the United States were racially and ethnically diverse. Approximately 25.2% of leadership and management positions were held by women as of December 31, 2023. The diversity percentages included in this section exclude current year business acquisitions. As a result of maintaining a consistent focus on an uplifting culture, our key talent (employees with the highest potential rating) retention rate excluding retirements in 2023 was 96.4%. Our companywide (all employees) voluntary retention rate excluding retirements was 90.4%. Culture and Purpose In 2023, we continued to drive our purpose to boldly challenge what's possible for a sustainable world through our strategic priorities and 2030 Sustainability Commitments. We use our Leadership Principles to guide our actions each day and enable our uplifting, engaging and inclusive culture. As part of our commitment to people and culture, we strive to create a work environment where our people uplift each other, make a positive impact on the planet and thrive at work and at home. Since 2006, our annual employee engagement survey has enabled employees to share their experiences and perceptions of our Company. Employees provide ra

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